Over the last two decades, the genetic basis for many human genetic diseases has been elucidated, and the ability to generate iPS cells from any individual with a genetic disease has made it possible to investigate the impact that genetic changes have on cell function in vitro. However, since the primary objectives of regenerative medicine are to repair and to replace human tissues, it is of critical importance to characterize genetic factors affecting organ development and function. Furthermore, in many situations, animal models, including genetically engineered mice, do not accurately reflect human organ physiology. Because of these roadblocks, the creation of an experimental platform for studying human organ development and function, which utilizes iPS cells generated from individuals with genetic disease, would represent a transformative advance with far reaching impact. We have recently developed a novel murine model for human liver regeneration, and novel methodology for differentiating human stem-progenitor cells into hepatic cells that can efficiently reconstitut human liver in this model. These highly innovative methods will be coupled to create the first human stem cell-based in vivo models for two human genetic diseases that cause liver pathology: Alagille syndrome (ALGS) and Alpers syndrome. If successful, this platform could be used to create in vivo models for many other human genetic diseases. We will also improve upon recently developed genetic engineering methodology to efficiently introduce (or revert) disease-causing mutations in human stem cells, and will characterize the effect of the altered allele (relative to isogenic cells) on human liver disease-related phenotypes in vivo. The pathobiology for each of these diseases cannot be properly analyzed using cellular or murine genetic knockout models. For example, the ALGS model will be used to answer fundamental questions about the role that a key signaling pathway (Notch) plays in the development of a solid human organ (liver), and to characterize the mechanisms underlying the highly variable disease manifestations that arise from seemingly similar genetic alterations in patients. Beyond this, these stem cell-based models have other transformative applications. Since many drugs have unexpectedly caused severe mitochondrial toxicity in humans, and we currently lack predictive screening methods to identify them, we will determine if the Alpers syndrome model (or an in vitro version using the iPS cells with the causative mutations) can be used to predict drug-induced mitochondrial toxicity in humans.